Affordable Care Act insurers are proposing a median premium increase of 14% for 2027, marking a second consecutive year of double-digit hikes, according to a new analysis of preliminary rate filings released by KFF on July 8, 2026. Across 77 insurers participating in ACA Marketplaces from 16 states and the District of Columbia, most insurers are requesting increases between 10% and 20%, with 20 insurers seeking hikes exceeding 20%.
If these increases are approved, typical insurance premiums for ACA Marketplace participants will have jumped by more than one-third over just two years, compounding affordability challenges for unsubsidized enrollees. The median increase for 2026 was 18%, with finalized rates reaching 20% on average.
The analysis examined preliminary rate filings submitted before the July 15 deadline, offering a window into the cost pressures insurers expect to face. Among the 77 insurers reviewed, none proposed decreasing premiums, underscoring the breadth of upward pressure across the individual insurance market.
What’s Driving the 2027 Premium Increases
Rising healthcare costs stand as the primary driver. Insurers cite a medical trend—the underlying cost of medical care and prescription drugs—of 10% for 2027, exceeding the 8% average growth seen over recent years, according to KFF. These cost increases stem from hospitalizations, physician visits, and prescription drugs becoming more expensive, combined with general economic inflation and healthcare labor shortages that have pushed provider wages higher.
Specialty medications, particularly GLP-1 drugs used for weight loss and diabetes, continue to strain costs. Some insurers have dropped coverage for weight-loss GLP-1s to contain expenses, though demand for diabetes-related uses remains strong. One insurer noted that GLP-1 costs have more than tripled over two years, rising from $13 per member per month in early 2024 to $49 per member per month by early 2026.
A second major factor is the expiration of enhanced premium tax credits at the end of 2025. These credits, created through the American Rescue Plan and extended by the Inflation Reduction Act, had expanded subsidies significantly. Their expiration caused a 58% average increase in out-of-pocket premiums in 2026 and prompted healthier, higher-income enrollees to leave the marketplace. This shift left behind a smaller, sicker population more expensive to insure. Insurers estimate this adverse selection drove 2026 premiums up by roughly 4 percentage points and expect another 4 percentage point increase in 2027 as the effect compounds.
Federal regulatory changes have also contributed. The Trump administration’s Marketplace Integrity and Affordability Rule and the 2027 Notice of Benefit and Payment Parameters introduced new enrollment requirements and cost-control measures that insurers say will increase administrative and claims costs. Additionally, the Working Families Tax Cut Act (H.R. 1), signed into law in July 2025, made certain low-income immigrants ineligible for financial assistance, further reshaping the risk pool.
When the enhanced tax credits expired, premium payments for unsubsidized enrollees climbed sharply. A 40-year-old in Indianapolis earning $65,000 annually—above the 400% federal poverty level threshold for subsidies—saw their monthly premium payment jump from $316 with enhanced credits in 2025 to $477 in 2026, reaching a projected $546 in 2027 if current filings are approved. That represents a 41% cumulative increase in just two years.
Most ACA Marketplace enrollees—87% in 2026—do receive some subsidy and may be partially insulated from premium increases if they stay in their current plan. However, the expiration of enhanced credits reduced the total subsidy pool, and many enrollees have shifted to cheaper bronze plans with higher deductibles. For the federal government, premium increases translate directly into higher subsidy spending as the benchmark silver plan—which sets the subsidy baseline—rises.
Sources
- KFF — Preliminary analysis of ACA Marketplace insurers’ 2027 rate filings from 16 states and DC, published July 8, 2026; detailed breakdown of cost drivers including medical trend, enhanced tax credit expiration, and federal regulatory changes
- Peterson-KFF Health System Tracker — Comprehensive analysis of 77 insurers’ rate filings, cost drivers, and risk pool effects; specific examples of GLP-1 cost increases and individual premium payment impacts
- AP News — Confirmation of 14% median increase proposal and summary of insurers’ cited cost factors
- PBS NewsHour — Reporting on second consecutive year of double-digit increases and healthcare cost pressures
